ATCO LTD -CLASS I (ACO-X.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:ACO-X - CA0467894006 - Common Stock
58.06 CAD
+0.31 (+0.54%)
Taking everything into account, ACO-X scores 4 out of 10 in our fundamental rating. ACO-X was compared to 19 industry peers in the Multi-Utilities industry. Both the profitability and the financial health of ACO-X get a neutral evaluation. Nothing too spectacular is happening here. ACO-X has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- ACO-X had positive earnings in the past year.
- In the past year ACO-X had a positive cash flow from operations.
- Each year in the past 5 years ACO-X has been profitable.
- In the past 5 years ACO-X always reported a positive cash flow from operatings.
1.2 Ratios
- ACO-X has a Return On Assets (1.55%) which is in line with its industry peers.
- ACO-X has a Return On Equity of 9.08%. This is amongst the best in the industry. ACO-X outperforms 89.47% of its industry peers.
- With a Return On Invested Capital value of 3.73%, ACO-X is not doing good in the industry: 73.68% of the companies in the same industry are doing better.
- Measured over the past 3 years, the Average Return On Invested Capital for ACO-X is in line with the industry average of 3.73%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.55% | ||
| ROE | 9.08% | ||
| ROIC | 3.73% |
ROA(3y)1.62%
ROA(5y)1.41%
ROE(3y)9.17%
ROE(5y)7.94%
ROIC(3y)3.92%
ROIC(5y)3.81%
1.3 Margins
- ACO-X has a Profit Margin (8.38%) which is comparable to the rest of the industry.
- ACO-X's Profit Margin has declined in the last couple of years.
- With a Operating Margin value of 24.56%, ACO-X perfoms like the industry average, outperforming 42.11% of the companies in the same industry.
- ACO-X's Operating Margin has declined in the last couple of years.
- ACO-X has a Gross Margin (74.90%) which is comparable to the rest of the industry.
- ACO-X's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.56% | ||
| PM (TTM) | 8.38% | ||
| GM | 74.9% |
OM growth 3Y2.6%
OM growth 5Y-3.18%
PM growth 3Y14.9%
PM growth 5Y-4.41%
GM growth 3Y-0.25%
GM growth 5Y-1.16%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ACO-X is destroying value.
- The number of shares outstanding for ACO-X remains at a similar level compared to 1 year ago.
- Compared to 5 years ago, ACO-X has less shares outstanding
- Compared to 1 year ago, ACO-X has a worse debt to assets ratio.
2.2 Solvency
- Based on the Altman-Z score of 0.78, we must say that ACO-X is in the distress zone and has some risk of bankruptcy.
- ACO-X has a Altman-Z score of 0.78. This is amongst the best in the industry. ACO-X outperforms 84.21% of its industry peers.
- ACO-X has a debt to FCF ratio of 27.90. This is a negative value and a sign of low solvency as ACO-X would need 27.90 years to pay back of all of its debts.
- ACO-X has a better Debt to FCF ratio (27.90) than 100.00% of its industry peers.
- A Debt/Equity ratio of 2.64 is on the high side and indicates that ACO-X has dependencies on debt financing.
- ACO-X has a Debt to Equity ratio of 2.64. This is in the lower half of the industry: ACO-X underperforms 73.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.64 | ||
| Debt/FCF | 27.9 | ||
| Altman-Z | 0.78 |
ROIC/WACC0.72
WACC5.19%
2.3 Liquidity
- A Current Ratio of 1.81 indicates that ACO-X should not have too much problems paying its short term obligations.
- ACO-X's Current ratio of 1.81 is amongst the best of the industry. ACO-X outperforms 100.00% of its industry peers.
- A Quick Ratio of 1.66 indicates that ACO-X should not have too much problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 1.66, ACO-X belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.81 | ||
| Quick Ratio | 1.66 |
3. Growth
3.1 Past
- ACO-X shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.19%, which is quite good.
- Measured over the past 5 years, ACO-X shows a small growth in Earnings Per Share. The EPS has been growing by 6.10% on average per year.
- Looking at the last year, ACO-X shows a small growth in Revenue. The Revenue has grown by 7.75% in the last year.
- ACO-X shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.98% yearly.
EPS 1Y (TTM)10.19%
EPS 3Y8.59%
EPS 5Y6.1%
EPS Q2Q%13.58%
Revenue 1Y (TTM)7.75%
Revenue growth 3Y4.84%
Revenue growth 5Y0.98%
Sales Q2Q%6.09%
3.2 Future
- The Earnings Per Share is expected to grow by 4.90% on average over the next years.
- Based on estimates for the next years, ACO-X will show a small growth in Revenue. The Revenue will grow by 2.20% on average per year.
EPS Next Y8.92%
EPS Next 2Y4.96%
EPS Next 3Y4.9%
EPS Next 5YN/A
Revenue Next Year0%
Revenue Next 2Y1.49%
Revenue Next 3Y2.2%
Revenue Next 5YN/A
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 12.79, the valuation of ACO-X can be described as correct.
- The rest of the industry has a similar Price/Earnings ratio as ACO-X.
- Compared to an average S&P500 Price/Earnings ratio of 27.30, ACO-X is valued rather cheaply.
- ACO-X is valuated correctly with a Price/Forward Earnings ratio of 12.29.
- ACO-X's Price/Forward Earnings ratio is in line with the industry average.
- ACO-X is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.79 | ||
| Fwd PE | 12.29 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, ACO-X is valued a bit cheaper than 73.68% of the companies in the same industry.
- 63.16% of the companies in the same industry are more expensive than ACO-X, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.03 | ||
| EV/EBITDA | 8.45 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.43
PEG (5Y)2.09
EPS Next 2Y4.96%
EPS Next 3Y4.9%
5. Dividend
5.1 Amount
- ACO-X has a Yearly Dividend Yield of 3.62%.
- Compared to an average industry Dividend Yield of 4.80, ACO-X's dividend is way lower than its industry peers. On top of this 94.74% of the companies listed in the same industry pay a better dividend than ACO-X!
- ACO-X's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.62% |
5.2 History
- The dividend of ACO-X has a limited annual growth rate of 3.93%.
- ACO-X has paid a dividend for at least 10 years, which is a reliable track record.
- ACO-X has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.93%
Div Incr Years31
Div Non Decr Years34
5.3 Sustainability
- ACO-X pays out 52.20% of its income as dividend. This is a bit on the high side, but may be sustainable.
- ACO-X's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP52.2%
EPS Next 2Y4.96%
EPS Next 3Y4.9%
ATCO LTD -CLASS I / ACO-X.CA FAQ
What is the ChartMill fundamental rating of ATCO LTD -CLASS I (ACO-X.CA) stock?
ChartMill assigns a fundamental rating of 4 / 10 to ACO-X.CA.
What is the valuation status of ATCO LTD -CLASS I (ACO-X.CA) stock?
ChartMill assigns a valuation rating of 4 / 10 to ATCO LTD -CLASS I (ACO-X.CA). This can be considered as Fairly Valued.
What is the profitability of ACO-X stock?
ATCO LTD -CLASS I (ACO-X.CA) has a profitability rating of 4 / 10.
Can you provide the financial health for ACO-X stock?
The financial health rating of ATCO LTD -CLASS I (ACO-X.CA) is 5 / 10.
What is the expected EPS growth for ATCO LTD -CLASS I (ACO-X.CA) stock?
The Earnings per Share (EPS) of ATCO LTD -CLASS I (ACO-X.CA) is expected to grow by 8.92% in the next year.